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Standard & Poor's upgrades Jamaica's credit rating

Published: Wednesday September 25, 2013 | 8:20 am Comments 0

Rating agency Standard & Poor's (S&P) has raised Jamaica's foreign currency sovereign credit rating from CCC-plus to B-minus.

S&P has cited a stabilizing economy and better access to new external funding from official creditors as the reasons for the upgrade.

The rating agency says the outlook is stable based on its expectation that the government will largely meet its ambitious fiscal targets this year.

S&P says the Jamaican economy has stabilized after the government entered into an International Monetary Fund (IMF) program that, coupled with additional external funding, supports the country's external liquidity and bolsters investor confidence.

However, S&P warned that Jamaica's ability to address its debt remains vulnerable to sharp fluctuations in the exchange rate or interest rates, as well as lower-than-expected gross domestic product growth.

In the meantime, the IMF board is to meet on Monday to discuss the report on its teamís first review of the countryís economic programme.

A release from IMF Resident Representative, Bert van Selm, says the documentation regarding the first review was delivered to members of the Executive Board last week.

Yesterday, finance minister, Dr. Peter Phillips disclosed that the September 30 deadline for the country to table the Omnibus Incentive Act would be missed.

The finance minister said discussions were held with the IMF and it was agreed that Jamaica would be given more time to work to bring the legislation to parliament.

Dr. Phillips said the new target is to have the Act passed by the end of October.

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